Composition and operations of the Board of Directors

According to Elisa's Articles of Association, the Board of Directors comprises a minimum of five and a maximum of nine members. The members of the Board are appointed at the Annual General Meeting for a one-year term of office starting at the close of the relevant General Meeting, and ending at the close of the next General Meeting. The Board of Directors elects a chairman and deputy chairman from among its members.

At its organising meeting, the Board of Directors annually decides upon committees, their chairs and members. In 2016, the acting committees were: the Compensation and Nomination Committee and the Audit Committee. The duties and charters of the committees are adopted by the Board of Directors.

Information on Board members

At the Annual General Meeting of 31 March 2016, seven (7) members were elected to the Board of Directors. Mr Raimo Lind, Mr Petteri Koponen, Ms Leena Niemistö, Ms Seija Turunen, Mr Jaakko Uotila and Mr Mika Vehviläinen were re-elected as members of the Board of Directors and Ms Clarisse Berggårdh as a new member of the Board of Directors.

Back from the left: Petteri Koponen, Jaakko Uotila, Leena Niemistö and Mika Vehviläinen
Front from the left: Clarisse Berggårdh, Chairman of the Board Raimo Lind and Seija Turunen

Main Board memberships and public duties currently undertaken: Chairman of the Board: Evac Group Oy and Nest Capital. Member of the Board: HiQ AB and Nokian Tyres.

Mr Mika Vehviläinen

b. 1961, M.Sc. (Econ and BA) Helsinki School of Economics 1986. Member since 2012 and Deputy Chairman since 2014.

Key employment history: CEO, Cargotec from 1 March 2013. CEO, Finnair, 2010–2013. COO and member of the executive team of Nokia Siemens Networks, 2007–2010. Nokia Oyj, various positions in the group, 1992–2006.

Main Board memberships and public duties currently undertaken: Chairman of the Board: Grand Cru Oy, Mindfield Games Oy, Everywear Games Oy, Onemind Dogs Oy and Kontena Oy. Member of the Board: Smartly.io Solutions Oy. Member: DigiNYT-seurantaryhmä.

Ms Leena Niemistö

b. 1963, MD, PhD, Specialist in Physical and Rehabilitation Medicine, University of Helsinki. Member since 2010.

Main Board memberships and public duties currently undertaken: Deputy Chairman of the Board of Pihlajalinna Oyj and Stockmann Oyj. Member of the board of Suomen Messut Osuuskunta. Chairman of the Board of The Finnish National Opera Ballet, HLD Healthy Life Devices Oy and BN Clarity Inc. Chairman of the prize committee of Ars Fennica. Member of the Board of Maanpuolustuskurssiyhdistys.

Ms Seija Turunen

b. 1953, M.Sc. (Econ.) graduated 1976 from Helsinki School of Economics and Business Administration, and with M.Sc. (Econ.) in 1978. Member since 2014.

Independence of Board members

All Board members are independent of the company and of the company’s major shareholders.

Elisa holdings of the Board members

Elisa holdings of Elisa's current Board members
and corporations in which they exercise control

Number of shares, 31 December 2016

Raimo Lind, Chairman

14 493

Mika Vehviläinen, Deputy Chairman

4 578

Clarisse Berggårdh, member

572

Petteri Koponen, member

2 181

Leena Niemistö, member

8 020

Seija Turunen, member

2 404

Jaakko Uotila, member

3 508

Charter of the Board of Directors

The Board attends to the administration and proper organisation of the company's operations in accordance with the Finnish Limited Liability Companies Act and other regulations. The Board decides on matters that under law are subject to decision by the Board. The company’s Board of Directors has adopted a charter for itself.

The charter tasks the Board with determining the company's strategic guidelines and the targets for Elisa's management, and with monitoring their achievement. The Board must also appoint the CEO and decide on the composition of the Executive Board. The Board of Directors regularly monitors financial performance and the development of the company's financial standing on the basis of management reports. The Board also supervises the compliance of Elisa's administration, and the management of business and other risks. The Board addresses major investments in and disposal of businesses or assets, and also sets the boundaries for the company's management in executing operational investments and financial arrangements.

According to the charter, the following are particularly subject to the Board’s decision:

Elisa's strategic guidelines

distribution policy

convening General Meetings and submitting proposals

matters having to do with Elisa's stock and Elisa shareholders

major mergers and acquisitions, as well as investments

financial statements and interim reports

appointment, dismissal and terms of employment of the CEO and members of the Executive Board.

The charter also specifies other matters to be addressed by the Board, such as adopting the annual financial plan, the principles of the company's organisation and the main business policies. The Board conducts an annual self-evaluation of its activities executed in the form of a questionnaire. Members of the Board of Directors are not allowed to participate in decision-making for which they must legally disqualify themselves due to conflict of interests.

Attendance at meetings by the Board members

Attendance at meetings by Elisa's Board members in 2016

Attendance/meetings

Raimo Lind, Chairman

18/18

Mika Vehviläinen, Deputy Chairman

17/18

Clarisse Berggårdh, member since 31 March 2016

16/16

Petteri Koponen, member

18/18

Leena Niemistö, member

18/18

Seija Turunen, member

18/18

Jaakko Uotila, member

18/18

Appointment and diversity principles for Board members

The company adapted diversity principles for Board members at the Annual General Meeting 2016.

At Elisa, diversity is seen as an essential part of corporate responsibility and as a factor in success that enables achievement of strategic targets and continuous improvement of customer intimacy.

In planning the composition of the Board of Directors, the shareholders’ nomination board takes into account the requirements of Elisa's business operations, the phase of development and the competence requirements of the Board committees. In appointing members of the Board the target is to ensure that the Board as a whole supports the development of Elisa's current and future business operations. Diversity plays a part in supporting this goal.

Diversity is considered from different perspectives. From Elisa’s point of view it is important to have Board members with diverse backgrounds in terms of competence, training, and experience of differing business operations, of varying stages of business development, and of leadership as well as diverse personal characteristics. Experience of international business environments and different cultures in addition to consideration of age and gender will support the diversity of the Board. The objective is to have at least two representatives of both genders.

A person elected as an Elisa Board member must have the competence required for the position and be able to devote a sufficient amount of time to the duties required. In forming the composition of the Board long-term needs and successor planning will be taken into account.

According to the Articles of Association, Elisa’s Board of Directors comprises a minimum of five and a maximum of nine members. The composition of the Board and the number of members shall be such that they enable the Board to perform its duties efficiently. Elisa's Shareholders' Nomination Board prepares the proposal for both the number of members of the Board of Directors and its composition. The members of the Board are appointed annually at Elisa's Annual General Meeting.

In 2016 at the Annual General Meeting seven members were elected to the Board of Directors. The competence, training, experience and personal characeristics of the Board of Directors are different and complement each other. The Board of Directors consists of 3 women and 4 men between 46 and 67 years of age. The composition of the Board of Directors as a whole is in accordance with Elisa's diversity principles.

The principles concerning the election of the Board and its diversity are available on the company's website at www.elisa.com.

Board committees

Compensation and Nomination Committee

According to its charter, the Compensation and Nomination Committee deals with and prepares the appointment and dismissal of persons within management, management succession planning and development, matters associated with long-term incentive schemes applicable to management, and other matters relating to the remuneration of management. The Committee also deals with incentive schemes for Elisa's personnel.

Audit Committee

The Audit Committee is tasked with supervising the proper organisation of the company's accounting and financial administration, financing, internal and financial auditing, and risk management. According to its charter, the following in particular shall be addressed and prepared by the Audit Committee:

The Committee also regularly reviews reports from internal auditing and the financial auditors, and prepares proposals on the audit.

In 2016, the Chairwoman of the Audit Committee was Ms Seija Turunen and the members were
Ms Clarisse Berggårdh (since 31 March 2016) and Mr Jaakko Uotila, and Mr Petteri Koponen (until 31 March 2016). The principal auditor also attends Committee meetings.